Many fresh graduates would think of Klang Valley as their career starting point. Well, this meant that they will need to buy a property in the KL or Selangor. Are the property prices in KL becoming too expensive that all of them are being forced to buy as soon as they could? Recently as reported in many media, Khazanah Research Institute director of research Dr Suraya Ismail said, “Young people used to rent for 10 years before deciding to buy a home. However, graduates today rush to buy their first homes, for fear of rapid price escalation. They think that if they do not buy today, they will never be able to afford a house.” She was speaking as part of a panel in a forum entitled, ‘Homeless Graduates: Reality or Myth?’
Tell me, if you are a fresh graduate today, do you feel the same? Well, based on my own understanding of the fresh graduates of today, this is not true. The better ones would work smart and hard and rise up the ranks pretty fast and within 5 years would already be comfortable enough to buy their first home. Typically however, many would be working just enough, trying to bargain for better pay by switching jobs for a little extra, buying the latest Samsung or iPhone to show off during cafe sessions and keep complaining that house prices are becoming too high. Thus, they did not buy and did not really bother to save. Well, that’s what the property transactions are showing anyway. The total numbers are still way too low versus the total demand that is available if all these fresh graduates are buying.
Dr. Suraya said that many of these fresh graduates are under a lot of stress because they do not have the confidence they can earn an income and fall into the middle income bracket. She also said that the level of profit for the developers show also go down and they should be achieving supernormal profits.
There are some truths to this when we compare the the more advanced nations with Malaysia. As for whether this is doable or not, I think we will leave this to the market to decide. Truth is, if the slowdown continues, the developers would also be facing lots of pressure and not just these fresh graduates trying to buy their first home. However, when the times are good, it is easy to understand why the property prices would be increasing every time a new project is launched. The queues even start many days before and in Penang many years ago, those who queue on behalf of the buyers were paid RM1,000 according to many market murmurs.
Look around us, benchmark ourselves with our peers. Are we still with the lead pack or have we started to fall behind? What are they doing that made them so successful? Perhaps it’s just the learning part which we are not doing well. No matter how well we do or how senior we are in any organisation, without investment, it is very risky. Any MNC choosing to leave will leave and losing such a high pay meant its tough to look for a similar paying job. Have we invested enough to ensure we have something to fall back upon? That’s the fear everyone should have. It should not be the fear of owning the first property. It’s the fear of owning just one property until the day we retire. Malaysia is a growing nation and we would be for many more years to come. Look at the babies of today for clue…. Happy deciding.
written on 21 Nov 2015
Next suggested article: The importance of size vs affordability